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ACC levy recommendations for 2017 – 2019

Released 24/11/16

Following a month-long public consultation ACC is making levy recommendations to the Minister for the 2017 to 2019 period.

ACC Chair Dame Paula Rebstock said it was great to see the numbers of people taking advantage of the opportunity to have their say on the levy proposals with nearly 1,100 submissions being made through the ShapeyourACC website.

“The changes being recommended to the Minister for ACC are a mix of reductions and increases to ensure levies are as fair as possible for all New Zealanders,” says Dame Rebstock.

The following levy changes are being recommended:

  • For car owners, a 13% reduction in the average Motor Vehicle levy.
  • For businesses, a 10% reduction in the average Work levy, and changes to workplace safety incentive products.
  • For employees, due to an increase in claims volumes and costs, a 3% increase in the Earners’ levy.

“What was most encouraging was the quality of feedback we received. It’s really important that people understand levy-setting and the proposals as this helps makes the process more transparent.”

Many respondents showed a preference for collecting a higher proportion of the petrol levy at the pump. When we set levies for vehicle owners, our priority is to make sure the money we collect will be enough to cover the costs of all injuries that happen on public roads. Collecting the Motor Vehicle levy through both petrol and the registration allows us to cover the risk based on distance travelled, while the registration portion allows us to recognise different vehicles have differing levels of risk of injury.

The Minister has asked us to consult on Electric Vehicles (EVs) and Plug-in Hybrid Electric Vehicles (PHEVs) and we received a wide range of views and suggestions on how these vehicles should be classified and levied. We’ll be considering these views as part of the wider review of the Motor Vehicle Account.

While the feedback on the proposed increase in the Earners’ levy was mixed, the submitters recognised the need to cover increased medical costs and increase in investment in injury prevention.

ACC is not recommending cuts to motorcycle levies as they are already heavily subsidised by other vehicle owners.

ACC, along with the recommendation of a 10% reduction in the average Work levy, will be working with businesses to develop incentives to make workplaces safer and reward businesses with good safety performance. During consultation we also proposed some initial thoughts on enhancing the experience rating system (which is a good way to demonstrate reward through claims experience) and we want to continue this conversation. The web page is still open so you can continue to provide feedback: 

Give feedback on workplace safety incentives

Recommended levies were calculated based the estimated lifetime costs of new claims and funding position of ACC's Accounts as at 31 March 2016.

Read ACC's full levy recommendations

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